The Technologies Changing Online Advertising

The landscape of online advertising is rapidly changing. New technologies have emerged that are not only disrupting traditional online advertising, but changing the way in which consumers engage with advertising content. Consider the following technologies which are improving advertising ROI and changing the way in which marketers engage their customers:

AI and Online Advertising

Ariticial Intelligence (AI) has been dismissed by some as a marketing buzzword – technically a part of upcoming online advertising technology, but not pervasive or popular enough to be pertinent to the vast majority of advertising clients. The familiar refrain “I don’t hear clients asking about it, it’s not important to them,” can be seen and heard all over the advertising industry. And yet tech giants like Microsoft and retailers like Nordstrom are leaping aboard the AI-Advertising train. Microsoft published a research paper that determined that improving the accuracy of CTR estimation in sponsored ads has an enormous impact on user search experience and business revenue. They report that “even 0.1% of accuracy improvement would yield greater earnings in the hundreds of millions of dollars.” Google, Alibaba, and Amazon have been building initiatives that emphasize the marriage between AI and big data. The reasoning is simple: there is simply too much excellent data not to turn it into useful, actionable, and revenue-generating insights. With predictive programming and analysis, referenced below, coming into play, we can be assured that AI is changing the nature of online advertising – for the better.

With predictive programming and analysis, referenced below, coming into play, we can be assured that AI is changing the nature of online advertising – for the better.

Predictive Programming

Predictive programming is one of the more cogent examples of the increasing sophistication in online advertising technology. This technology collects and analyzes a wide variety of online behavioral data from individual users. Almost all online behavior can be collected, whether it relates to where the user is going online, what they are doing there, how long they are spending, what they are clicking or even looking at, and even how they get there.

This yields a huge amount of helpful information that can be synthesized into a profile of a user, which, in turn, can be leveraged into more interesting, pertinent, and overall successful online advertising. This innovative technology is not dissimilar to simple re-targeting, at least on the face of it, but a deeper look reveals that predictive programming is much more complex and finely tuned. Retargeting has been very powerful for the advertising world, but it has come with some major problems. For example, being retargeted for all guitar-related products when you bought a guitar strap once as a gift. Predictive programming doesn’t exclusively rely on a single purchase or website visit to offer up advertisements in that realm.

Click to Tweet: Predictive programming and analytics are aiding advertisers in their efforts to both increase ROI and provide a better advertising experience for those who will be marketed to.

Omni-Channel Marketing

Omni-Channel marketing means providing users with a seamless experience across all channels and devices. The key realization here is that multi-channel marketing is simply no longer the most powerful way of reaching and marketing to consumers. Omni-channel marketing provides pathways of communication between the user and the company that allow a better user experience, create more points of interaction, and more opportunities for revenue-generating action. The interaction with the user across all points of contact allows companies to link customer identifiers and enhance data-gathering. A report found that of the customer insights to be gleaned from omni-channel marketing, the most important were purchasing propensities and buying behaviors, profitability and lifetime value, and purchase history. With the benefits of omni-channel marketing making themselves more and more apparent to marketers who are willing to invest in the integration, 78% of companies surveyed said that they are either currently experiencing or anticipate experiencing a sales lift. The goal: delivering a personalized and satisfying marketing experience to consumers. The solution: omni-channel marketing.

Connected TV

CTV is any television that connects to the internet – including Smart TVs, devices like Apple TV and Roku, and gaming consoles like the X-Box or Playstation. With ad-skipping technology improving every year, business are getting less bang for their buck on TV ads, but CTV, which is rapidly encroaching on the traditional TV market as it is, also provides a happy solution for advertisers. Last year, nearly 60% of households own a CTV. 160 million Americans streamed using CTV every month, CTV use grew 300% but CTV only accounts for barely 1% of TV ad dollars. The drawback with CTV is that it currently has no “measurement currency,” meaning that there is no highly effective way to measure audience size and makeup. The lack of cookies and device IDs is holding CTV back from the billions of dollars that are being wasted on traditional television. But by no means does this setback indicate that CTV will remain an online advertising footnote. The audience, popularity, and reach of CTV cannot be ignored. CTV is not being utilized at the level that is should be, and contains enormous opportunity for dynamic businesses.

Programmatic

Many of the technologies we have written about in this analysis are based in the growth of AI, but equally as important as being able to gather and utilize customer data is being able to efficiently implement it. This is where programmatic technology comes in. Programmatic ad buying uses software to purchase digital advertising rather than going through the traditional process of negotiations, insertion orders, RFP’s and other hassles. This, in turn, makes advertising less expensive as companies cut down on overhead. Programmatic software is also exceptionally versatile, allowing advertisers to utilize RTB (or real-time-bidding) as well as buying guaranteed ad impressions in advance – called programmatic direct. A report from Accenture found that today buyers and sellers on average use programmatic for only 17 percent of their inventory, but within the next two years, that figure will rise to 35%.

As you can see, the forward march of technology continues to radically redefine online advertising. As these technologies continue to improve and refine their measurement and ROI, they will become increasingly critical to online advertising and marketing. If your brand is in need of fresh perspectives and leadership, contact 10TH DEGREE today.